(Updates with analyst quote in fourth paragraph.)
Nov. 16 (Bloomberg) -- The head of the International Monetary Fund’s European department quit less than a year into the job and was replaced by an in-house economist as the European debt crisis worsens.
Antonio Borges, a Portuguese native whose unit oversees bailouts in the euro region, left for “personal reasons,” the Washington-based IMF said today in an e-mailed statement. His successor is Reza Moghadam, who has made his career at the fund and headed the strategy department.
The management change comes as the IMF, which is co- financing bailouts in Greece, Portugal and Ireland, is preparing to send a team to Italy for an unprecedented audit of the country’s efforts to cut its debt. Borges, a former vice chairman at Goldman Sachs International, last month retracted comments he made about the fund’s possible involvement in the European bond market. He couldn’t immediately be reached for comment today.
“He has been a person who has been perhaps not particularly careful about his message discipline” at a time of “acute sensitivity for the IMF” said Jacob Funk Kirkegaard, research fellow at the Peterson Institute for International Economics in Washington. By contrast, Moghadam “is an in-house guy, he’s been there for a very long time and he’s clearly someone who knows the ins and outs of the IMF.”
In the Spotlight
The European Department has been in the spotlight as the Washington-based agency lends to a dozen countries from Romania to Portugal on the continent. The IMF is set to also co-fund a second loan program to Greece, just as European officials seek to pull together as much money as they can to show investors they can stamp out the region’s worsening turmoil.
“Antonio Borges has led the European Department during an extremely difficult period for the region’s euro-zone members,” IMF Managing Director Christine Lagarde said in a statement.
She added that she looked forward to having Moghadam “applying to our work in Europe the same strategic vision, drive, and thoughtfulness that he has demonstrated in his previous position.”
Borges joined in November 2010 after overseeing a group in Europe that set standards for the hedge fund industry, the London-based Hedge Fund Standards Board.
Borges was a vice chairman at Goldman Sachs International in London from 2000 to 2008. He was a professor of economics and dean of INSEAD Business School in Fontainebleau, France, from 1993 to 2000 and a deputy governor of the Banco de Portugal from 1990 to 1993. Borges received a doctorate of economics from Stanford University in California.
--Editors: Chris Wellisz, Gail DeGeorge
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